Flashback: Manufacturing Crown Beaten Down
ABOVE Alabama workers in Alexander City sew Russell premium product, team jerseys.
Russell Corp. was a crown jewel of Alabama manufacturing in July 1988 when it was the subject of a Business Alabama cover story. Based in Alexander City, the textile/apparel company was two years on the Fortune 500 list, ranking 489th among all manufacturers and 12th among textile companies. Among Alabama public companies, Russell was third largest in total assets, $2.1 billion.
Starting in 1902 with six knitting machines and 12 sewing machines, by 1988 Russell employed 11,000 workers at 34 plants, 26 of them in Alabama. Top products included athletic uniforms, workout garb and light woven fabrics.
But seismic shifts were under way in American manufacturing in the late ’80s, in textiles in particular, culminating in the consolidation of three of the oldest companies in the textile industry — J.P. Stevens & Co., Pepperell Manufacturing Co. and West Point Manufacturing Co. Most of those manufacturing activities retrenched in the non-union South, then finally fled south of the border.
Russell was fighting that trend by massively investing in technology. In 1988 the company began a two-year, $160 million expansion and capital improvement program that followed $164 million pumped into plant improvements between 1981 and 1986.
Russell’s strategy held up until 1997, three years after the NAFTA agreement went into effect. Sales and income fell for the first time in decades. The next year, a major restructuring began that cut 4,000 jobs, 23 percent of its workforce and closed 28 percent of its plants.
When restructuring ended in 2001, more than 6,000 jobs had been cut, and all manufacturing operations had moved outside the U.S.
Warren Buffett-led Berkshire Hathaway Inc. bought Russell Corp. for $600 million in 2006. It became a division of Fruit of the Loom, and its headquarters was moved to Atlanta, Georgia.
Beginning in 2009, United Students Against Sweatshops led a boycott of Russell Brands for its treatment of workers at plants in Honduras. More than 100 universities joined in the boycott.
Chris McFadyen is the editorial director of Business Alabama.